Khan launches ‘modern comeback for council housing’

The Mayor of London has introduced a programme that aims to get 10,000 new council homes under way over the next four years.

Khan will use money from the £1.67 billion the Greater London Authority (GLA) received from the government in the Spring Statement. He believes that what is needed to solve the housing crisis is a “modern comeback for council housing”.

A statement from the mayor’s office notes that in the 1970s councils in London were supported by central government and built more than 20,000 homes a year. In the 1990s that dropped to “almost zero”.

Khan cited government rules and funding cuts as being contributing factors.

He is offering councils greater expertise and flexibility over funding, and the opportunity to bid for grant funding at a special rate, which will allow them more easily to offer new homes based on social rent levels.

A deal has already been struck under ‘Building Council Homes for Londoners’ with Waltham Forest council leader Clare Coghill, the new Mayor of Lewisham, Damien Egan, and Mayor of Newham, Rokhsana Fiaz.

Waltham Forest plans to start 525 council homes with £26 million of funding from City Hall over the next four years, while both Newham and Lewisham have each committed to starting 1,000 council homes by 2022.

Khan has previously criticised the government for failing to give councils the freedoms they need to ensure that all homes sold under Right to Buy rules are replaced. The programme, he said, offers councils a way to ring-fence their Right to Buy receipts to help them replace those sold.

He said: “I am proud to launch Building Council Homes for Londoners – the first ever City Hall programme dedicated to new council housing. I want to help councils get back to building homes for Londoners again, and I’m doing that with support from the £1.67 billion fund I secured from government to help get 10,000 new homes under way over the next four years.

“I am offering councils expertise and resources from City Hall to scale up their homebuilding programmes, and I will help them to replace homes sold through Right to Buy. The government is failing to enable councils to replace the hundreds of thousands of council homes sold through Right to Buy, and so I will do all I can to help councils replace as many of them as possible.”

Reaction:

Sian Berry AM, Chair of the London Assembly Housing Committee, said the programme is a “step in the right direction to help solve London’s housing crisis”.

“We are pleased that the mayor is focusing these resources on building more truly affordable homes, based on social rent levels and not at the definition that goes up to 80 per cent of market rents.”

“Only nine per cent of the mayor’s last tranche of grant funding went to councils, with the rest going to housing associations, and it’s positive he is doing more this year to help councils secure these grants. If the mayor is to build the number of homes at real social rents that London needs, his plans will have to be even more ambitious.”

Berry added the committee wants to make sure the money goes to providing additional affordable homes and not replacements for homes being demolished as part of development schemes.

Martin Bellinger, executive chairman at Guildmore, said: “The mayor’s £1.67bn fund to build 10,000 homes in London is a most welcome step to delivering the housing we need. Part of this investment must be strategically targeted at building affordable homes, and less of it directed at building more of what we already have. Londoners need homes they can afford, as house price growth is still outpacing wage growth in most areas of the capital.”

Matthew Good, planning drector at WYG said the delivery of 10,000 homes over the next four years is a welcome addition "to dealing with the huge lack of appropriate social housing within the city".

"However, this will only make a small ‘dent’ into the need for 43,500 affordable dwellings per annum identified within the draft London Plan. To deliver the levels of affordable housing identified will require some radical solutions and a concerted effort by the mayor, local authorities and the development industry.

"Other cities such as Greater Manchester and Birmingham should be keeping a keen eye on the success of this scheme. In Greater Manchester Andy Burnham has long argued that the city does not deliver enough affordable housing and will be keen to identify ways to bolster the supply."